Cotton Prices Soften Following Suspension of Import Duty
02-Jun-2026 12:00 PM
Mumbai: Following the Central Government's announcement to withdraw or suspend the import duty applicable to cotton for the five-month period from June to October 2026, prices in the domestic market have begun to soften. In recent days, global market prices for cotton have also witnessed a decline.
Previously, an import duty of 11 percent was levied on cotton, which has now been suspended. Meanwhile, at the New York-based Intercontinental Exchange (ICE), a marginal recovery was recorded in cotton futures prices on the first trading day of the current week—June 1, 2026.
Industry and trade analysts observe that, following the announcement regarding the suspension of import duties, Indian textile mills have commenced signing contracts for cotton procurement. While bookings have currently been made in limited quantities, a significant increase in activity is anticipated in the near future.
Concurrently, the Cotton Corporation of India (CCI)—a subsidiary agency under the Union Ministry of Textiles—once again reduced the base selling price of its cotton stock by ₹700 per candy (356 kg) on June 1. Prior to this, the base selling price had already been reduced by a cumulative total of ₹3,000 per candy across two phases.
However, despite this latest reduction, interest among millers and traders in purchasing the Corporation's cotton remained subdued; consequently, only 700 bales (each weighing 170 kg) of cotton were traded on June 1. At the ICE, cotton futures prices recovered by 1.68 percent, reaching 77.44 cents per pound.
According to trade analysts, domestic market prices for cotton continue to face downward pressure due to buyer apathy. With the suspension of customs duties, buyers now have access to a new set of options: they may choose to import cotton directly from overseas markets or purchase it from domestic resellers.
This latter category includes independent stockists, the Cotton Corporation of India, and multinational corporations. Meanwhile, the sowing season for cotton is set to commence shortly.